Cyprus’ construction costs and property prices continue to climb, driven by higher material costs, strong demand and sustained building activity, according to new market analysis by Ask Wire.
Speaking about the latest market trends, Ask Wire CEO Pavlos Loizou said international steel and copper prices, rising energy costs, supply chain pressures and continued construction activity remain the main drivers behind higher building material costs.
Apartment prices rise sharply
Figures from the Central Bank of Cyprus show that apartment prices increased by 10.8% year-on-year during the first quarter of 2026, while house prices rose by 3%.
Ask Wire’s transaction data for the first half of 2026 also highlights significant regional differences in average apartment sale prices:
Limassol – ~€363,000
Paphos – ~ €262,000
Nicosia – ~€183,000
Larnaca ~ €171,000
Famagusta ~ €150,000
Loizou said Limassol remains Cyprus’ most expensive apartment market, largely due to its high-end beachfront developments and luxury residential towers.
“Paphos follows, ahead of Nicosia, Larnaca and Famagusta,” he said.
He added that although Nicosia’s market is primarily supported by domestic buyers, apartment prices have continued to rise compared with 2025.
“A typical two-bedroom apartment measuring around 75 to 90 square metres is generally priced close to, or slightly above, the average for each district. Final values depend on location, age, energy efficiency and, in coastal districts, proximity to the sea.”
Larnaca leads price growth
According to Loizou, Larnaca is recording the strongest annual increase in apartment prices, with values rising by approximately 8.9%, while price growth has begun to moderate in both Limassol and Paphos.
“Our data confirms this momentum,” he said.
“During the first half of 2026 we recorded 1,521 apartment transactions in Larnaca, the highest volume anywhere on the island.”
He attributed the city’s strong performance to several factors:
- robust overseas demand;
- greater affordability compared with Limassol;
- a lower starting price base;
- continued infrastructure improvements; and
- stable rental yields from modern, energy-efficient one and two-bedroom apartments close to the coast.
Demand remains strong
Loizou said demand across the Cyprus property market remains robust with no signs of slowing.
“Property transactions reached a 17-year high in 2025, with transfers worth €4.7 billion. That momentum has continued into 2026.”
He noted that sale contracts increased by 13.8% during the first quarter of 2026, while Ask Wire’s own figures show strong transaction volumes across every district.
Foreign buyers continue to drive the market, accounting for as much as 75% of transactions in Paphos, supported by improving domestic demand as housing lending increased by 24.5% and mortgage interest rates fell to around 3.15%.
Loizou said the strongest demand continues to be for modern one and two-bedroom apartments near the sea, particularly those with high energy efficiency ratings.
Outlook for 2026
Looking ahead, Loizou expects property prices to continue rising during 2026, although at a more moderate pace.
He forecasts annual price growth of around 3% to 5% across Cyprus, with Larnaca expected to outperform the national average.
Newer apartments with strong energy performance are likely to achieve price growth of between 4% and 6%, he said.
While lower interest rates continue to support demand, affordability pressures, constrained housing supply and geopolitical uncertainty are expected to prevent another sharp surge in prices.
Large luxury homes may underperform as they rely more heavily on cautious high-net-worth buyers.
Overall, Loizou expects the market to remain resilient, with steady growth and no indication of a widespread price correction.